More security through blockchain: MasterCard applies for a patent

A recently published MasterCard patent application indicates that the credit card giant has turned a blind eye to blockchain applications. The company wants to improve customer data protection with the latest application.

Using a semi-private or private blockchain, MasterCard wants to receive and store users’ identity data. This could include information such as name, address and tax number. This is not MasterCard’s first patent application for the blockchain. Last year, the company filed a patent application that allows payments to be processed more quickly.

The added value of the Bitcoin formula application with MasterCard

Blockchain technology could help avoid fake identities during registration. According to the patent application, the system generates one Bitcoin formula file for each unit, with a public key and the geographical area of responsibility. These child files then receive a digital signature from a parent entity. A server hashing module then generates an identity value for each unit and a block containing the record of the most recent block and a timestamp.

Unlike a public blockchain, the MasterCard network allows only certain nodes to feed data. These authorized nodes prevent the storage of data that affects the accuracy of the stored data.

A concrete use case

MasterCard would thus create a classic blockchain-use case. To put it simply, it must now be ensured that a person’s data is correct and documented only once at MasterCard. Let’s take a look at the classic use case of MasterCard: People usually use it to pay for their purchased goods in the retail trade. In a payment process that has to be faster and faster these days, the verification of the card user is quickly lost. At this point, a signature is just an arbitrarily inaccurate means of verification. A PIN can also be stolen. It should therefore be checked whether the user of the credit card is also the true owner. Using a barcode or magnetic stripe, the cashier could access the MasterCard blockchain and quickly read out owner data such as name, address, date of birth and a photo. This could help avoid the misuse of a credit card.

When shopping online, the process may look like the credit card record must match the ID card record. Here, too, the data can be compared using a barcode on the credit card or ID card.

Why not with the help of a central database?
At this point, one can also ask oneself why it is not possible to store this data in a central database. On the one hand, these are sensitive data which, on top of that, have to be stored forgery-proof. Only a blockchain can offer this protection against forgery. On the other hand, MasterCard is one of those companies that has to think globally in a world that is currently struggling with globalization. Due to political uncertainties, a central server may not be available worldwide.

Denmark: Yippee, no taxes on the Bitcoin secret

After months of delay, Denmark has now announced that the private trade of Bitcoins is exempt from tax.

The tax authority’s decision is based on the fact that Bitcoin is not regarded as “real money”. Thus, any Bitcoin activity (regardless of whether it generates a profit or a loss) is not taxable. Commercial Bitcoin activities are subject to normal income tax and must be booked in the course of business.

At the time of the announcement, Denmark was the only country in the world that definitely considered taxing Bitcoin. The early reactions of the European Bitcoiners were positive, both the further effects of the announcement remain to be seen. If Bitcoins are not “real”, do they still enjoy the protection of private property?

Bulgaria: A Bitcoin secret tax gap?

Let’s take Bulgaria by contrast. The Eastern European country announced this week that trade in Bitcoin secret is subject to income and corporate tax. However, a requirement to document Bitcoin secret profits has not been issued, raising the question of potential money laundering through digital currencies.

Bulgarian enthusiast Stamen Gorchev then proposed joining the other EU members to find a comprehensive regulation.

Bulgaria’s announcement thus means that Bitcoiners will have the full range of possible tax treatment available in Western countries. This means the company will be able to benefit from potentially lucrative transfer pricing.

China: rumours and ban by banks
The Bitcoin isn’t really illegal in China, is it? The rumours about a ban on Dogecoin, Bitcoin and other Altcoins are still going around.

Just like the sharp fall in prices at the end of 2013, the current fall in prices is also attributable to the Chinese authorities and the strong investment volume in China. Possible regulatory measures on the part of the central bank recently led to a drastic drop in the share price.

Although the exact reasons for the alleged ban are unknown, the fungibility of Bitcoin is threatened by capital controls by the communist state.

The network was also known for its resilience to state censorship, which has plagued many Internet users for years.

Colombia: Bitcoin ban?

The Colombian Ministry of Finance could ban Bitcoin in cooperation with the central bank. That’s what a recent El Tiempo report said.

Colombia has joined the list of those who have issued an official warning to their citizens regarding the Bitcoin trade.

The Colombian government is unlikely to object to the novelty of Bitcoin, as the South American country is not known for financial innovations that may have an impact on the economy. Rather, the issue will arise that the Bitcoin can be used for criminal purposes.

Colombian security forces see a danger that the Bitcoin can be used for drug trafficking and for financing communist rebels.

Isle of Man: No licence required
On 26th March the Isle of Man announced that the country’s listing requirements do not apply to trading exchanges.

The Financial Supervision Commission has announced in a written statement that Bitcoin exchanges are neither investment firms nor money transfer companies within the meaning of the law.

The island is a self-governing colony of England and its citizens are English. The island is also known as a tax haven due to its low 0% tax rate.

Lamoureux crypto trader predicts a Bitcoin price of $25,000

The macroeconomists at Lamoureux & Co are convinced that Bitcoin will be worth $25,000 and more in the long run.

Thanks to the incidents we reported elsewhere regarding the Bitcoin stock markets in China, the price fell by almost ten percent, that is, by 100 dollars. At the moment, however, the share price seems to be recovering.

According to Yves Lamoureux, this is only the beginning. In a recent article, he states in various places that we are in a bubble of Bitcoin. Investors who otherwise tend to invest in hard assets such as gold or other precious metals and venture capitalists now smell the big deal.

Bitcoin as the world’s leading crypto trader currency

This assumption is also shared by the crypto trader of Netcoins: Michael Vogel believes that Bitcoin could become a global crypto trader currency by 2020. If this were to happen, it is to be expected that the price would rise dramatically.

Tim Draper, a top-level investor whose investments are in the millions of dollars range, is also thinking in a similar direction and believes that Bitcoin will gain significantly in value. But he suspects another mechanism behind it: “Many investors currently seem to want to invest in Bitcoin start-ups rather than in Bitcoin. They are convinced that these start-ups will gain importance – and that the price of Bitcoin will rise rapidly as a result.

Three years ago Tim Draper made the bold prediction that in 2017 a Bitcoin would be worth $10,000. Even if you are far away, he trusts that this also applies to the end of the year and remains true to his predictions.

In a previous article, Lamoureux argued that hyperinflation controlled by the central bank would begin in a few years, with Bitcoin and other encrypted currencies benefiting from this hyperinflation.

Currently, however, it has a different position: it compares the expected increase in the value of Bitcoin with that of gold: when gold was traded for 300 dollars, people invested mainly to escape the monetary devaluation.

In this sense, not much has changed in commercial behavior for a hundred years:

People invest when they can hope to make a profit. But for that to happen, most potential investors need to be convinced that an investment is worthwhile.

“Whether it’s tulips, real estate: Bubbles need active investors. With more and more use cases, the technology blockchain is becoming ubiquitous – which in turn gives the technology behind Bitcoin confidence and investors. We believe that encrypted currencies like Bitcoin are currently in such a cycle.

IOTA and eCl@ss plan global industry standardization 4.0

The IOTA Foundation will work with eCL@ss e.V. in the future. eCl@ss is the only cross-industry ISO/IEC-compliant industry standard that is used worldwide.

IOTA is intended to help eCl@ss transfer standardized eCl@ss data securely and reliably

They found each other: IOTA and eCl@ss announced their cooperation on 5 December. Since both IOTA and eCl@ss focus on Industry 4.0, this decision seems quite obvious. After all, standards must be developed for the Internet of Things that can be applied globally.

“We look forward to working together […] on the development of new standards for device communication and complex payment processes in the Internet of Things”, says Thorsten Kroke, CEO of eCl@ss. They are familiar with standardization. The association was founded in 2000 and initially had twelve members, including Siemens, SAP, Bayer and E.ON. In the meantime, the number of members has grown to almost 150. Among the members, who together make a trillion annual sales, are industry leaders such as VW, BASF, RWE, Fujitsu and Bosch. The cross-sector standard for the classification and standardization of master data is used by over 3,500 companies worldwide.

The Internet of Bitcoin loophole

For Gerhard Treitinger, Product Manager at Bosch subsidiary BSH Hausgeräte, it was interest at first glance: When we first heard about Bitcoin loophole and its data marketplace, the joint implementation of IOTA and eCl@ss seemed like a natural step. Read more on: Is The Bitcoin Loophole a Scam? Beware, Read our Review First

This is also due to the fact that both want to position themselves as central players in the development of the Internet of Things and its standardization.

Holger Köther, Director of Partnerships at the IOTA Foundation, is correspondingly enthusiastic:

“It is an extraordinary opportunity to shape how the next generation of devices can communicate through data and micro payments in all industry landscapes to really strengthen a machine-to-machine economy for the Internet of Everything”.

With this cooperation, IOTA comes into indirect contact with a whole bouquet of large companies and hidden champions. IOTA cannot yet complain about a lack of interest on the part of the industry. However, there is still little that goes beyond mere announcements of cooperation. At least you can take a look at what the cooperation between IOTA and eCl@ass could look like.

Another example of the “Tangle to touch” is the company iampass. Its founder was a guest at the BTC-ECHO podcast in October to talk about his company’s IOTA-based hand-held vein scanner:

The Austrian School: Dollar Democracy

Over the past century, democracy has positioned itself as the best form of rule in the minds of the population. Gone are the days of despotic rulers and the oppression of the individual. In democracy, everyone has a voice. Economist Ludwig von Mises makes it clear, however, that there are two different forms of democracy, only one of which actually serves the individual. These democratic principles can also be applied to Bitcoin & Co.

The role of the cryptosoft entrepreneur

Here is how onlinebetrug explained the essential role of cryptosoft entrepreneurs in a market economy. An entrepreneur is a person who tries to anticipate and satisfy the needs of the market, i.e. the needs of others. The entrepreneur produces goods or offers services accordingly. He exposes himself to a risk, because the future is uncertain and he could be wrong with his prediction. Mises further describes that it is not a matter of determining the future perfectly, but of doing so better, or less badly, than the other entrepreneurs.

The entrepreneur’s business is not merely to experiment with new technological methods, but to select from the multitude of technologically feasible methods those that are best suited to serve the most urgent needs of the public as cheaply as possible.

– Ludwig von Mises

The entrepreneur is completely powerless at the mercy of the market. If he is right with his assumptions about the future, he is rewarded by the market.

The democracy of the market

In the market economy, every consumer decides for himself which products he wants to buy. Through a purchase, the consumer “votes” for the product. He gives the entrepreneur an unmistakable understanding that he has predicted the need best. With this view it becomes clear that the concept of profit and loss is nothing other than the numerical evaluation of the accuracy of the entrepreneur’s prediction.

The aggregate of all consumer decisions forms the market and symbolizes the most direct and just form of democracy. After all, consumers are not forced to make their decisions. In addition, every consumer receives exactly the product he bought, in other words: the product he voted for.

If a person finds a better or cheaper way to satisfy the needs of the market, he has a chance to be rewarded in the form of profit. Thus the position of a successful entrepreneur is by no means static and secured for all time, but exists only as long as he can win the market with the better quality or lower prices of his products. Democratic voting never ceases, but takes place anew with every trade. It is the democracy of the market, which is also called “dollar democracy”.

Those who prefer to drink Coca-Cola buy Coca-Cola and get Coca-Cola. The same applies to Pepsi drinkers.

Democracy of politics
In politics, democracy is far less effective and efficient than in the marketplace. First of all, it has to be said that votes do not happen on a daily basis. Instead, the population, or the “consumers of politics”, vote at random intervals, usually several years apart. If the needs of a consumer change within this time span, he has no possibility to spontaneously change supplier.

Furthermore, the consumer does not get exactly the product for which he is voting. The winner of the democratic election is who can reach a certain percentage. All consumers are then subject to this winner. So every voter has one vote, but he does not get what he has voted for.

This concept would be comparable to shopping in a supermarket, but instead of every consumer deciding whether he wants to buy Coca-Cola or Pepsi (or neither), the votes of all those present are collected, counted and the will of the majority is then binding for all buyers.

Smart Contracts and Crypto Currencies

We have seen that Smart Contracts are simply a way to execute program code distributed over a network. This achieves the data integrity guaranteed by the respective blockchain platform. But how does this fit in with the hype in the IoT area (e.g. the automatic cold chain monitoring with fines mentioned in the introduction)? In such cases, the Smart Contracts consistently manage monetary clearing units (crypto currencies).

For example, a Smart Contract could be set up for a refrigerated container that is to be transported from Singapore to Amsterdam. This implements the monitoring of the maximum permitted temperature fluctuation range (which the logistics company guarantees) and at the same time an automatic penalty payment in the event of a deviation.

The really interesting and new thing about blockchains in the Bitcoin news

The Bitcoin news contract could be designed in such a way that an IoT sensor reports the temperature to the Smart Contract every hour during the entire transport and a deviation from the agreed temperature range immediately provides for a further blockchain transaction to transfer a settlement currency as a penalty payment. This is further explained by onlinebetrug.

Blockchain networks, which automatically handle decentralized electricity deliveries, are also similar combinations of IoT sensors with Smart Contracts in the background. (Basically, the term “Smart Contract” is based on such concrete advance agreements that do not require manual or even judicial follow-up and are implemented in a purely technically automated manner.

The really interesting and new thing about blockchains is that they allow the creation of completely decentralized structures. Network participants no longer have to agree on a central, trustworthy location, but only on the content of the Smart Contracts. These then run decentrally in the blockchain network. Not only for the logistics sector, but for all market areas, there is hope that market participants will be able to implement digitization processes without restricting their autonomy by choosing a central processing organ (possibly from a pool of competitors from the same industry).

And I personally find that extremely exciting

Ingo Rammer is a speaker at the Blockchain Technology Conference from 19-21 November in Berlin. There you can gain practical experience with international experts. There will also be live demos and case studies of real implementations, individual interaction with experts and networking opportunities with people from various industries. You can also expect a variety of sessions, workshops and short presentations from international speakers.

Exclusive discount code for our readers: Simply enter blockchain-btc-15 and secure 15 percent discount. Tickets are available here.

Ingo RammerIngo Rammer is one of the founders and managing directors of Thinktecture AG and has been supporting developers in the use of new technologies for almost twenty years. His focus is the hype-free use of blockchain technologies in the B2B environment, especially in private networks based on Hyperledger Fabric or Parity.

Bitcoin (BTC) – Price analysis – Breathing in a sideways trend

After testing the 8,000 euro mark, the price moved in a sideways trend. A slight uptrend or a triangle pattern was passed, but this uptrend was broken in the night of April 30th. The price could rebound at the support described by the plateau from April 20 to 23 and is currently struggling with the EMA50.

The news spy price fell slightly this week

After an attempt to break the upward trend that had been pursued since mid-April, the price bounced off it and onlinebetrug tested the scam exponential moving average EMA50. Overall, the news spy price is rather bearish. The most important support and possible stop loss is 7,359.50 euros, the first interesting resistance and thus the first target 7,620.99 euros.

Yesterday’s rather mixed assessment is confirmed: The Bitcoin price fell by 5 percent on April 30. For the average Hodler this disappears in the noise. In any case it is certain that the plateau of the last days, which was 7,620.99 euros, was broken through. In the short term, the price even dropped below the exponential moving average EMA50, but bounced off the support described by the April 27 minimum. This minimum is at the same level as the former resistance of the triangle pattern mentioned last week.

The MACD (second panel from above) is still positive, but strongly falling and is about to test the zero line. Accordingly, the MACD line (blue) is below the signal (orange). The RSI is at 43 and therefore bearish.

Overall, the impression is bearish according to the price, trend and indicators

Support and Resistance
The first support is 7.359,50 Euro and is described by the minima of April 27th and May 1st. These are at the level of the resistance of the triangle pattern discussed last week or the plateau passed from April 20 to April 22. Another support is described by the EMA 100 at currently 7.192,17 Euro.

The first resistance is at 7,620.99 Euro and thus at the level of the broken upward trend. If the price should overcome this level, a further Resistance would be described by the monthly maximum of April with 7.995,00 euro.

Entry Points, Stop Losses and Targets
The latest bounce of course invites you to a long position. Stop loss would then be at the level of support at 7,359.50 euros, first target at 7,620.99 euros and second target at 7,995 euros. Of course, the stop loss has to be trailed when the first target is reached again.

If the price falls below the stop loss, one has to look out for a possible re-entry point. Should the price at the support bounce at the level of the EMA100 at 7,192.17 Euro, this would again be a good moment for a re-entry. The mentioned support would then be a good stop loss, targets would be at 7.359,50 Euro, 7.620,99 Euro and 7.995,00 Euro.

Disclaimer: The price estimates presented on this page do not represent recommendations to buy or sell. They are merely an assessment of the analyst.

Solidity: How to program Smart Contracts?

Since Vitalik Buterin developed Ethereum, smart contracts have become an integral part of the blockchain ecosystem. But what is behind these “smart contracts”? In five parts, Ingo Rammer explores the implications of the technology for us. Today: Why is a Smart Contract secure?

Why exactly is the whole thing safe?

So far, so good. But what about the security of this approach? What would happen if one of the participants simply exchanged the smart contract on the blockchain node he controlled and used a variant that was advantageous for him? (Depending on the blockchain, the attacker would have to dive relatively far into the internals of the implementation of the blockchain platform – but it is still a valid attack vector that has to be considered at least on a theoretical level).

What would an attacker have to do?

In our example, an attacker could try to take control of all phone numbers by changing the check conditions in his version of the smart contract. But this would lead to the World State being changed only on the attacker’s node: Only for him it looks as if he controls all telephone numbers.

All other participants would continue to execute the correct version of the contract. If, due to the consensus mechanism chosen between the participants, the attacker is selected by the network itself to generate new blocks, these would immediately be rejected by the other participants.

The attacker would lose the status of the block generator again, since depending on the configuration of the block chain, half or two thirds of all participants must agree with the result of a transaction before it is considered correct network-wide. An attack attempt therefore only harms the attacker himself.

One can therefore compare this attack with a bank customer crossing out the status on his printed account statement and overwriting an increased credit balance. From his point of view, he now has much more money than before. But as soon as he tries to access this money, he is very quickly brought back to the bottom of the facts: his own view remains a wish and will at best be acknowledged by his counterpart with a smile.

How is a Smart Contract called up?
Having seen so far how a Smart Contract is technically defined, and knowing that it can trigger events that external (non-blockchain) systems can process, one last piece of the puzzle is still missing: How is the Smart Contract actually called?

Most blockchain platforms have corresponding SDKs in JavaScript, .NET and/or Java for this purpose. These SDKs allow the creation, signing and transmission of transactions to own or externally operated nodes of the blockchain network.

For Ethereum derivatives, a Smart Contract is called as follows: First, the method name and the method arguments are converted into a defined binary format. For this, auxiliary methods are provided by the SDK that can process the interface description (ABI – Application Binary Interface) of the Smart Contract and generate the corresponding binary data. A transaction is then created that uses as the destination address the address that was created during the instantiation of the Smart Contract described above.

This entire operation can either be performed explicitly in individual steps by the client code, or – as shown in Listing 5 – it can also look like a normal function call using automatically generated methods. In the listing we see the relevant part of the call of the above mentioned contract method requestTransfer, which uses web3.js [4], the JavaScript SDK for Ethereum.